ABSTRACT
Despite mounting evidence of the benefits of migrating for employment, less is known about the costs incurred by migrant workers seeking work overseas. The financial costs paid by migrants for jobs that should otherwise be borne by their foreign employers can represent a significant portion of a migrant’s foreign earnings – drastically reducing the net gains from moving abroad. This chapter presents several key findings using the KNOMAD-ILO Migration Cost Surveys (MCS) dataset collected as part of a new initiative by the Global Knowledge Partnership on Migration and Development (KNOMAD) in partnership with the International Labor Organization (ILO) to develop a methodology on measuring recruitment costs incurred by workers pursuing low-skilled positions. A primary aim of this project is to work with other United Nations (UN) agencies and national statistical agencies to develop a new SDG indicator 10.7.1. The proposed Recruitment Cost Indicator (RCI) is the average worker-incurred recruitment cost paid for securing an overseas job, expressed as a multiple of monthly foreign earnings. The MCS dataset reveals substantial corridor-level variation in up-front costs incurred by migrant workers that further varies by gender and across time. Heterogeneity in paid recruitment costs across migration corridors can be attributed to both origin and destination country regulatory practices and policies. In particular, destination country admission policies that regulate the inflow of workers have a noticeable impact on costs. Though more than half of the workers borrowed money to pay for migration expenses, only a small fraction incurred interest payments. In view of the Global Compact on Migration, efforts to reduce recruitment costs would require curbing the exploitative practices and abuses by illegal recruitment agents (or sub-agents), allowing direct recruitment by certified bona fide overseas employers; and bilateral coordination between labour sending and destination countries to ensure greater pathways for regular migration at substantially lower costs.
